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Is Non-Use of a Trademark Excusable?


By
Smith & Hopen PA

A trademark is considered to be abandoned if its use has been discontinued with intent not to resume use. 15 U.S.C. Sec. 1127. No use for three consecutive years is considered to establish prima facie  evidence of abandonment. Id. A showing of prima faciecreates a rebuttable presumption of abandonment without intent to resume use. Crash Dummy Movie, LLC v. Mattel, Inc., 601 F.3d 1387, 1391 (Fed. Cir. 2010). Courts have found that merely stating that special circumstances exist and there is no intent to abandon the mark is not sufficient. In re Conusa Corp., 32 USPQ2d 1857 (Comm’s Pats. 1993). The Trademark owner must establish that the mark was used during the statutory period or intended to resume use of the trademark. In Crash Dummy movie, the court found continued research and development efforts were sufficient to establish intent to use despite the fact that Mattel allowed the trademark registration to lapse. Id.at 1392. The court also stated that the board may consider evidence and testimony of intent to resume before or after the three year statutory period.Id.

In order to show excusable nonuse a section 8 declaration must be filed with the United States Patent and Trademark Office (USPTO). The USPTO currently requires the declaration to include 5 things:

1. The registration number;

2. The name and address of the current owner;

3. The fee for filing the declaration;

4. A list of goods/services in the registration on or in connection with the mark is not in use in commerce; the date of the last use of the mark in commerce; the approximate date when use in commerce is expected to resume; details regarding the reason for nonuse; and specific steps being taken to resume use; and

5. A signed and dated affidavit or declaration under 37 CFR Section 2.20.

The TMEP Section 1604.11 provides specific examples of when the USPTO has found what does and what do not establish excusable neglect:

·Business Decision.Nonuse related to a business decision is not beyond the owner’s control and does not excuse nonuse.

·Decreased Demand. Decreased demand for the product sold under the mark, resulting in its discontinuance for an indefinite period, does not excuse nonuse. The purpose of the affidavit requirement is to eliminate registrations of marks that are in nonuse due to ordinary changes in social or economic conditions.See In re Conusa Corp.,supra;In re Parmalat S.p.A., 32 USPQ2d 1860 (Comm’r Pats. 1991);Ex parte Astra Pharmaceutical Products, Inc., supra; Ex parte Denver Chemical Mfg. Co.,supra.

·Trade Embargo or Other Circumstance Beyond Owner’s Control. Nonuse may be considered excusable where the owner of the registration is willing and able to continue use of the mark in commerce, but is unable to do so due to a trade embargo.

·Sale of a Business. Temporary nonuse due to the sale of a business might be considered excusable.

·Retooling. The mark might be out of use temporarily because of an interruption of production for retooling of a plant or equipment, with production possible again at a scheduled time. However, nonuse due to retooling is excusable only if the owner shows that the plant or equipment being retooled was essential to the production of the goods and that alternative equipment was unavailable on the market.In re New England Mutual Life Insurance Co., 33 USPQ2d 1532 (Comm’r Pats. 1991).

·Orders on Hand. If the product is of a type that cannot be produced quickly or in large numbers (e.g., airplanes), yet there are orders on hand and activity toward filling them, nonuse might be considered excusable.

·Illness, Fire, and Other Catastrophes. Illness, fire, and other catastrophes may create situations of temporary nonuse, with the owner being able to outline arrangements and plans for resumption of use. Such nonuse is often excusable. However, a mere statement that the owner is ill and cannot conduct his or her business will not in itself excuse nonuse; the owner must show that the business is an operation that could not continue without his or her presence.New England Mutual Life Insurance, supra.

·Negotiations with Distributors. A recitation of efforts to negotiate agreements that would allow for resumption of use of the mark, or a statement that samples of the goods have been shipped to potential distributors, may establish lack of intention to abandon the mark, but does not establish the existence of special circumstances that excuse the nonuse.In re Parmalat, supra; In re Moorman, supra.

·Use in Foreign Country. Use of the mark in a foreign country has no bearing on excusable nonuse of a mark in commerce that can be regulated by the United States Congress.In re Conusa, supra.

·Use of Mark on Different Goods/Services. Use of the mark on goods/services other than those recited in the registration does not establish either special circumstances or lack of intention to abandon the mark.Ex parte Kelley-How-Thomson Co., supra.

·Use of Mark in Another Form. Use of a mark as an essential part of a materially different composite mark does not excuse the failure to use the mark at issue.In re Continental Distilling Corp., 254 F.2d 139, 117 USPQ 300 (C.C.P.A. 1958).

Prior to alleging excusable non-use, consult one of trademark attorneys. For more information, call 800-807-3531.

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